WooCommerce Payment Gateways: A quick guide

WooCommerce is very flexible and gives you a number of choices when building out your online store. It’s one reason it’s the best platform for running an ecommerce store – you don’t have to rigidly stick with what a third party allows. That being said, your WooCommerce store can’t sell a thing without a payment gateway. It’s how you actually get paid. 

One of those choices you have is the payment gateway or gateways that you use. What factors go into making your choice? This article breaks down the types of gateways available, compares the most popular options for WooCommerce, and helps you decide which is WooCommerce payment gateway is best for your store. Here are just a few things to consider:

• The popularity of the gateway with your target market
• The associated costs (such as percentage of sale value in fees)
• The reliability of the gateway
• The associated features with the gateway.

With that in mind, we’ve created this quick guide on how to choose a WooCommerce payment gateway, highlighting some of the top choices:

What is a payment gateway for WooCommerce?

First of all, the term “payment gateway” is in itself ecommerce jargon. What does it mean? A payment gateway is a merchant service that processes credit card payments from customers purchasing on your website. It acts as a “gateway” between buyer and seller by encrypting data for the transaction. That’s the primary reason it is known as a gateway – it removes the need for sellers to collect and store any payment details, which could leave you open to hacking attacks and liability for that data.

Payment gateways can also perform other functions. For example, they can screen orders and flag those that appear suspicious, use geolocation for businesses that are location-specific and calculate taxes on orders. They often include features such as receipts and integrations with shipping information.

Types of WooCommerce payment gateways

Payment gateways generally come in one of three different forms:

1. On-site payment. This is generally used by the big retailers as it involves some serious responsibility for data protection. It means the payment is handled through their own servers, but it also gives them the advantage of creating the experience that they’d like. Companies like Home Depot use on-site payment.
2. Checkout on-site, payment off-site. This is where the front-end of the checkout happens on the retailer’s website, but the processing side happens through the back-end of the payment provider. Stripe is an example of this, where their forms appear on the front-end.
3. Checkout redirect. This is where the customer is redirected off the ecommerce site to complete payment details for the checkout. PayPal is an example of this. If you click on the PayPal button, you will be prompted to login to your account in a new window.

In general, the fewer steps and redirects, the better your conversion rate so most stores prefer on-site or embedded options where possible. Express payments, as offered by CheckoutWC, can help shorten that flow even more than a typical on-site payment gateway! 

What payment gateways are available for WooCommerce?

The short answer to this question is virtually all of them. At the time of writing this, 64 extensions for payments were available in the WooCommerce Extensions Store.

You obviously don’t want to offer 64 payment options, but there is some data to show that offering customers different options to pay can help with conversions. If there’s more than one way to pay, the chances are you have a gateway that they want to use. Some suggest that merchants should at least offer the top three payment methods for their area or region.

Not all payment gateways are built the same. For example, some won’t take certain types of credit cards, or allow payments from international customers. Let’s say you run the sort of business where you can expect international payments (like a tourism operation or a gift store from which people order for local friends and relatives), that now becomes a priority in terms of choosing a gateway.

It may take some research on your part to ensure you’re offering what your customers need. Common gateways include PayPal with more than 220 million active accounts worldwide; Stripe, which supports more than 100 currencies and offers mobile payments; and Authorize.net which supports all major credit cards. Then you’ve got services like Amazon Pay and Apple Pay, which are popular due to the number of users on those platforms.

Top 5 WooCommerce Payment Gateways 

Stripe vs PayPal for WooCommerce

Stripe is a good choice for WooCommerce stores with customers spread across the world. Stripe supports 135+ currencies and processes billions in ecommerce payments annually.

It allows you to accept multiple different types of credit cards and currencies and can allow payments through mobile channels. It’s generally the easiest to setup, and you’ll find a few different payment gateway providers offering up solutions. It can handle large transaction volumes, works out as an economical option compared with some others. Stripe also allows you to take payments directly on your website, meaning no redirect for customers.

Common stripe solutions include:

• Stripe by PaymentPlugins
• Stripe by WooCommerce

Should I use PayPal too?

There are a few different versions of PayPal for WooCommerce. PayPal Pro allows you to take payments directly on your site, whereas PayPal Checkout offers a redirect option, that also includes Venmo. A small subset of users will strongly prefer PayPal – so while it may be easier to only offer Stripe or another standard payment gateway, it’s often worthwhile to also include a basic PayPal option for the users who care. 

• Pros: Very commonly-used and trusted among shoppers, available in many countries and currencies. They also offer good protection for both buyers and sellers.
• Cons: The fees. Currently, these are 9% plus 30 cents per transaction for local payments, and 9% for international payments.

Note: if you’re using WooCommerce Subscriptions, PayPal can be a bit annoying to deal with. But because PayPal doesn’t have an expiry date (like a typical credit card!) long-term subscription retention rates will likely be considerably higher for your PayPal customers. 

Amazon Pay

Amazon has millions of users who have their payment details stored in their accounts. Amazon Pay allows them to quickly access those payment details to process payment to your ecommerce store.

• Pros: Millions of users, no need to collect payment details on your site, no charge to the end-user for creating and using their account. Amazon Pay is available in the US, UK and several European countries.
• Cons: Fees for the seller are on the higher side. Currently a domestic processing fee of 2.9% and an authorization fee of 30 cents. Taxes may also be charged.

Apple Pay

Apple Pay has become more widely accepted, including in brick-and-mortar retail stores. It’s available to users of Apple devices and like Amazon Pay, users don’t need to access their credit cards directly to make a payment.

• Pros: Accepts all major credit cards, lower transaction fees – in the US they are 0.15% of the purchase. Apple Pay is supported in 30+ countries or regions.
• Cons: It’s only for your Apple users.

Authorize.net

Authorize.net makes it possible for you to receive payments through a variety of payment processors and credit cards. In a sense it’s a “one stop shop” for payment gateways.

• Pros: Accept a variety of payment processors, including Paypal and Amazon Pay, accept all major credit cards, simple solution to cover a lot of payment options.
• Cons: Fees – you pay for convenience. Currently, fees are 2.9% per transaction and if you have their “all in one” payment provider option, you’ll also pay an extra 30 cents per transaction.

How should you choose a payment gateway?

Here are a few criteria to consider when choosing your payment gateway:

1. What do my customers prefer to use? Different regions have different preferences – what works for Europe is different from what works in the US.
2. What fees do they charge? There is a wide difference between some of the gateways, BUT…
3. … what features do you get in return for the fees? Sometimes you might find the ones that charge more have better security protocols and protections against fraudulent transactions.
4. Do you prefer customers to remain on-site for payments or are redirects okay?
5. What is the reputation of the provider? Customers might shy away from something less-known, but be reassured by the security seals of providers they know.

Making the final call on your WooCommerce payment gateway

Payment gateways are an essential part of your WooCommerce store so it’s important to choose carefully. You can have more than one, but your customers should be the most important consideration.

Find out what your customers prefer and research options that will protect both their interests and yours. Everyone benefits when secure options with a strong reputation are offered.

Finally, we often get asked, “does payment provider X work with CheckoutWC?” The answer is usually yes – most payment gateways work out of the box with CheckoutWC. If you have any trouble with any WooCommerce payment gateway alongside CheckoutWC, reach out to support and let us know. We’re happy to help!

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